There is no history to suggest this is sustainable. This price move remains the most extreme technical disconnect in the $DJIA ever. – Northman Trader

The U.S. dollar has had the worst January since 1987. There’s a lot of reasons why the stock market crashed in October 1987, but the declining dollar was one of the primary catalysts. The rest of the world, led by China, is methodically and patiently removing the dollar as the world’s reserve currency. The cost for the U.S. Government to fund its rapidly expanding spending deficit is going to soar. Absent the ability to print unlimited quantities of electronic dollars, the U.S. Government’s credit quality is equivalent to that of a Third World country.

Silver Doctor’s invited me to join Elijah and Eric Dubin for their weekly Metals and Markets podcast. We discuss the issues above plus have a little bit of fun:

The cost to buy down-side protection has never been cheaper. No one, I mean no one is short or hedged this market. When slide starts, it will quickly turn into a massive avalanche. You will have to be set up with hedges and short positions or you will miss the money that will be made from taking a lonely contrarian view of the market.

My subscribers who shorted my homebuilder stock idea two weeks ago are now up 17.7%. That’s if they shorted the shares. They are up even more if they used puts. If you are interested in learning how to take advantage of the coming stock market crash, you learn more about the Short Seller’s Journal here: Short Seller’s Journal information.

So basically…per Mnuchin’s logic, a weak dollar is good because it helps turn the USA into an export economy…just like China! Never mind the fact that burdensome price controls and restrictions on labor and commerce in the states are the biggest barriers to entry for businessmen everywhere. Kids can’t even open lemonade stands without being harassed by law enforcement.

The irony here is that in due time, China will effectively say, “You got what you wished for!” and let the U.S. lead in exports. Except what the U.S. gets back will be trinkets compared to what could had been if the money was left sound.